Xerox, originally known as the M.H. Kuhn Company and then the Haloid Company, has been around for more than 100 years. The first electrophotographic or xerographic copy was made in 1938 by inventor Chester Carlson, who patented the technology in 1942. In 1948, the name “Xerox” was trademarked. Since then, Xerox has permeated our culture to the point where some people, when they want to make a photocopy of something, will simply say, “Xerox it.” Xerox has changed a lot in 100 years, as my conversation with Ken Stephens will reveal.
Sramana Mitra: Hi, Ken. Let’s start with some context. Tell us a bit about your background, what vantage point we’re going to have this conversation from, and what you’re currently doing at Xerox.
Ken Stephens: I manage Xerox cloud services. I’ve been in the IT outsourcing industry for pretty much my whole career. I was originally a true technology guy. I worked my way from the ground up, so I’ve worked in pretty much all of the technology arenas. Then for the last 15 years or so, I’ve been managing accounts, divisions, businesses, continents, and so on. I have, over the years, managed strategy, innovation, R&D and investments. I’m very comfortable with new investments and changes in technology and opportunities. Frankly, that’s how I ended up running cloud services.
About rhree years ago, I recognized a potential opportunity and presented it to our board of directors. I said, “This is something I think we should pursue.” They agreed, and I’ve been running it ever since.
SM: Do you want to talk about what you’ve been doing over the last three years, running the cloud services division of Xerox? When people think about Xerox, they don’t think about cloud services. They think of Xerox’s earlier positioning. Why don’t you bring us up to speed with what’s happening at Xerox. And more important, what’s happening today?
KS: Xerox, as we all know, has been in the printer and copier business forever. But the reality is they’ve been moving into the services business for the last five or six years. They’ve been gradually expanding their services capabilities for some time. Two years ago, Xerox bought ACS. With the acquisition of ACS, they have now about 50% of the revenue within Xerox [coming from] services. So, Xerox is fully in the business process outsourcing (BPO) business as well as the IT outsourcing business. It’s half the company.
In the IT services space – we’ve been in the cloud for about three years – we approached the cloud recognizing two basic tenets of the conversation. One is that it’s a natural progression from the traditional IT services, moving beyond virtualization and higher and higher leverage points. It moves to a much more automated ability to provide services. By automating more and more, it positions us to have a bigger market. The ability to deliver becomes cheaper. As it becomes cheaper, it positions you to sell to smaller companies and to companies in more diverse locations around the world. The cloud provides all kinds of opportunities, and we recognized that early on.
The key to that, though, is in order to take full advantage of the cloud and move into these new markets and be able to sell these services in a cost-effective manner by automating them, you can’t move away from the demand of enterprise customers, which is that security is paramount. You simply cannot jeopardize security for enterprise-class customers. So, in the beginning – three years ago – we moved down the path of investing in integrating security into our automation. Everything we automate is fully secured as a component of the automation itself. As we’ve added new capabilities, like infrastructure as a service (IaaS) or mobility device management, security is just a natural part of the service offering. We just keep investing. More service offerings are created every quarter.
SM: Give me the gist of what kinds of service offerings and what kinds of customers. What segment of customers are you catering to? What size? What industries?
KS: The standard service offering that was the first to be introduced into the cloud was infrastructure as a service, which is essentially buying compute no-processing. We offer that as a service much like our competitors. We do that around the globe. But there’s more that you can do than just IaaS. We could offer disaster recovery services, backup services for laptops or systems or whatever. We could also offer collaboration as a service. We could offer services around managing mobile devices, those types of services.
There are some new services that we are looking to introduce as well, around service aggregation or software as a service for industry-specific applications. So, you take a health care application or a retail application or a financial services application and we can put a wrapper around that and resell that on behalf of the software developer. There are a great many services that we can and are offering in the cloud computing space. But I think it’s relevant that our approach to the cloud is holistic in that we’re not looking at any one service offering. We’re looking at all IT services that you would expect from an IT outsourcing firm. We’re making everything cloud enabled. So, all services that you would expect from an IT outsourcing firm are what we’re moving into the cloud and introducing those services as fast as we possibly can.